Net Operating Income (NOI) is a key metric in real estate and business investment that measures the profitability of an income-generating property before costs like taxes and financing expenses are considered.
Net Operating Income (NOI) is a critical metric in the real estate industry that assesses the profitability and financial health of income-generating properties. By calculating NOI, investors can evaluate the operating performance of properties without considering financing, taxes, or capital expenditures.
The Overall Rate of Return (OAR) is a percentage relationship of net operating income (NOI) divided by the purchase price of a property. It is a metric used to assess the profitability of an investment.
A replacement reserve is an amount set aside from net operating income to pay for the eventual wearing out or replacement of short-lived assets.
